Australia, Japan strike free trade deal

TOKYO – Beef is the big winner in a free trade agreement struck between Australia and Japan after seven years of negotiations, according to international news reports.

Under terms of the FTA the 38.5 percent Japanese tariff currently levied on Australian beef will be halved to 19.5 percent over 18 years, according to news reports. The tariff currently applies to frozen beef. A tariff on chilled beef will be cut to 23.5 percent from 38.5 percent over 15 years.

An overview document of the Japan Australia Economic Partnership Agreement (JAEPA) noted: “As the first significant beef exporter to secure preferential access to Japan, Australia will have an immediate advantage over its major competitors. Australian beef exports to Japan, worth $1.4 billion in 2013, will benefit from a halving of the tariff, with a deep cut immediately on entry into force.”

While Australian beef industry stakeholders were encouraged by the FTA, the National Cattlemen's Beef Association (NCBA) expressed concerns about JAEPA's impact on the Trans-Pacific Partnership.

“NCBA is deeply concerned that the Bilateral Trade Agreement between Japan and Australia does not call for full tariff elimination,” said Bob McCan, NCBA president, in a statement. “This Bilateral Agreement undermines the long-standing goals and principles that are the base of the Trans-Pacific Partnership (TPP).
“This development only pushes the high-standing ideals of TPP further out of reach for all countries involved, and it is not a move that US beef producers can support,” he added. “The TPP has been referred to as a 21st century agreement, but this Bilateral Agreement is from the 20th century playbook and will not serve to foster open trade and certainly will not benefit consumers and producers globally.”

The National Pork Producers Council has called for a comprehensive offer by Japan to “liberalize” its agriculture sector. NPPC argued that Japan is trying to claim exemptions for sensitive products.

Prime Minister Tony Abbott was in Tokyo on his first North Asian trip. Japanese Prime Minister Shinzo Abe is expected to formally sign the deal in July when he travels to Canberra. The FTA will come into effect later in 2014.